Development profit math.

Property development profit calculator measures development viability. 500k land + 1M construction + 100k soft costs + 80k finance = 1.68M total cost. 2.2M sale revenue = 520k profit (31% PoC, 24% PoR). Industry rule: target 20%+ profit on cost (PoC) - below 15% PoC, deal too tight given execution risk.

Example: 500k land acquisition + 1M construction + 100k soft costs (planning, design, surveys) + 80k finance cost = 1,680,000 total cost. 2.2M sale revenue. Profit = 520k. PoC = 31% (excellent). PoR = 23.6% (strong). Lender minimum typically 20% PoC - this comfortably qualifies. Real test: still profitable at 6-month delay + 20% cost overrun + 10% revenue reduction.

Development profit components: Hard costs (construction, materials). Soft costs (planning, design, surveys, legal, marketing - typically 10-15% of construction). Finance costs (development loan interest, fees - 5-15% of project cost). Land acquisition (varies). Sale revenue net of selling costs. Each line needs careful estimation. Most failed developments: optimistic revenue + understated costs. Always model worst-case scenario - conservative assumptions are friend, not enemy.

A worked example

Try the defaults: land acquisition cost of 500,000, construction cost of 1,000,000, soft costs of 100,000, finance cost of 80,000. The tool returns 520,000.00. You can adjust any input and the result updates as you type — no submit button, no reload. That's the real power here: seeing how sensitive the output is to one or two assumptions.

What moves the number most

The result responds to Land Acquisition Cost, Construction Cost, Soft Costs, Finance Cost, and Sale Revenue. Not every input has equal weight. Flip one at a time toward extreme values to feel which ones move the needle most for your situation.

The formula behind this

Profit = sale revenue - all costs (land + construction + soft + finance). Everything the calculator does is shown in the formula box below, so you can check the math against your own spreadsheet if you want.

Using this well

Treat the output as one point on a wider map. Run it three times — a pessimistic case, a central case, and a stretch case — and plan against the pessimistic one. That habit alone separates people who stick with an investment plan from those who bail at the first wobble.

What this doesn't capture

Steady-rate math ignores real-world volatility. Actual returns are lumpy; sequence-of-returns risk matters most in drawdown; fees and taxes drag on compound growth; and behaviour changes in drawdowns can reduce outcomes below the projection. Treat the number as one scenario, not a forecast.